TEETERING on the verge of collapse from months of non-payment by the government, Eastern Cape homes for the aged are preparing to take the provincial Social Development Department to court to force an overhaul of the beleaguered system.
The move comes as thousands of pensioners cared for by non-profit organisations (NPOs) such as Cheshire Homes and the Echo Foundation face being left homeless as the facilities battle bankruptcy.
Of the 12 homes for the aged and the frail, as well as for the mentally disabled, approached by The Herald, none had received any subsidies since March.
Even then, the funding they did receive from the government was up to 50% down from 2010, after the department slashed the numbers of pensioners they would subsidise.
The problem of non-payment arose in August last year when various care centres in the Bay held a special meeting as they faced financial ruin.
Now, national welfare body Nawongo, which represents more than 500 facilities for the aged, is helping to coordinate an Eastern Cape group action lawsuit to compel the department to rewrite its policy on funding of non-profit care facilities.
Nawongo won a precedent-setting high court case last year against the Free State Social Development Department after it failed to pay NPOs caring for pensioners.
Nawongo spokesman Willem Botha said yesterday the latest lack of payment had prompted East London frail care facility Kennersley Park, working with the Legal Resources Centre (LRC), to seek out other NPOs to take legal action against the provincial department.
Kennersley Park general manager Noel Clarke said the centre’s government subsidy had been cut by almost half after the department said it would only subsidise 63 of its 120 patients.
"We are in the process of instituting legal action against the department with the help of the LRC,” he said.
"We have reached crisis point and if this is not resolved as soon as possible, we will have to send 20 of our patients home. We have had a huge financial loss of about R300000.”
Botha said Nawongo would fully support the court case and the plan now was to seek out other organisations in the same predicament to join in the legal action.
"They are busy preparing documents and getting other old age homes in the Eastern Cape to join them.”
Cheshire Homes coordinator Hilary Bolton said the two homes in Summerstrand and Cleary Park, which receive a combined monthly subsidy of about R150000, as well as two day-care centres run by Cheshire, would face possible closure within the next six months if they did not receive their government grant.
The subsidy, which the home has not received since April, contributes to a quarter of the home’s costs, and Bolton said the non-payment "played havoc” with the running of the home.
"Our two residential Cheshire Homes in Port Elizabeth that jointly accommodate 93 chronically physically disabled adults, who mostly come from impoverished communities, are faced with an ever-increasing challenge to survive,” she said.
"Soaring municipal costs as well as irregular government subsidy payments are contributing towards this struggle. If we don’t receive the grant we run the risk of closure, because there is only so much money we can raise on our own,” Bolton said.
An official at the Malabar Home for the Aged said: "Yes, we have been having problems but the department has said it is in the process of being sorted out.”
The Aurora Special Care Centre in Walmer Downs is also having to dig into its limited cash reserves.
"The government subsidy has not been paid since March,” chief executive Tanya Eales said.
"We are fortunate to have a reserve fund and we can delve into other sources, but we can’t go on like that forever.”
Echo Foundation chief executive Ken Keen said although the frail care centre was still coping without the government subsidy, the situation could not continue.
"It is now June and we are still waiting for the April subsidy. If the situation goes on, we would have to [re]consider the intake of new patients and, if it goes on even further then we will have to look at the staff issues. It will affect jobs at the end of the day if it goes on.”
Department spokeswoman Nomiky Tshangela said the organisations would be paid once their claims had been received – even though those organisations contacted by The Herald said they had already done so.
"The 157 NPOs from Port Elizabeth were paid in March for their March claims.”
Tshangela said Cheshire Homes, Aurora Special Care Centre and the Echo Foundation would be paid on Wednesday.
"The Lake Farm Care Centre’s claim has not yet been received by the department,” she said.